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The Basics: Fraud 101

Fraud and identity theft continue to be some of the fastest growing crimes in the U.S. spanning countless industries, including the electricity marketplace. With 7% of all U.S. households reporting some type of identity theft, utility fraud is estimated to cost Texans millions of dollars each year.

Consumer driven markets like utilities, telecommunications and credit cards continue to face fraud schemes and scams that are constantly evolving, putting consumers at risk and ultimately driving up the cost of electricity. Fraud can manifest in many ways, but typically falls into one of three categories.

Intentionally attempting to mislead someone. (Scam)

Using another person’s information without their knowledge or consent to enroll in or act on an account. (Identity theft)

Utility fraud comes in several forms. The most common involves the opening of a fraudulent account — for cable, electricity, water or gas — in a consumer’s name without their knowledge or consent (e.g., using stolen identification information). The impact of being the victim of a utility scam can range from a financial loss, to identity theft, damage to one’s credit history and the unwelcome time and energy required to correct the situation.

Shred Documentation. Identity thieves commonly search in your trash for personal information, but this can be prevented by using a quality crosscut shredder. Be sure to shred all documents that have your name and address, such as bank statements and invoices, receipts, return address stickers, envelopes, catalogs and—especially—pre-approved credit offers, credit card checks and insurance-related materials.

Guard Your Technology. Encrypt your emails and computer files or documents that contain personal or account information. Use firewalls, antivirus and anti-spyware programs. Also, protect your smartphone with passwords and key locks. Keep all technology current and use the latest security updates. Always employ “strong” passwords that contain numbers, symbols and characters. Don’t use obvious passwords, such as your date of birth, child’s or pet’s names or mother’s maiden name. Change passwords often, and don’t use the same one for online banking that you use for shopping or social networking sites. Do not open attachments or click on links within emails if you don’t know the sender, or seem suspicious.

Lock It Up. Keep doors, drawers and filing cabinets inside your home or business secure. Keep computers, paper files such as bank or credit card statements, passports, Social Security cards, earnings statements, birth certificates and any other documents with personal identifying information behind closed—and locked—doors or in locked drawers. Always be aware of who has access, such as household employees or work crews—and even family members.

Check Your Credit Reports Early And Often. Remember to check your credit at least annually. You may request a free credit report once every 12 months from each of the nationwide consumer reporting companies: Equifax, Experian and TransUnion at www.annualcreditreport.com. Investigate suspicious activity, report it to the appropriate parties and stay on top of it until the matter is resolved.

Keep Your Social Security Number Secure. A Social Security Number (SSN) and address can be key pieces in setting up fraudulent accounts and establishing credit in someone else’s name. Never carry your SSN or card in your wallet or purse unless absolutely necessary, and never give out your number to anyone you don’t know and trust. Provide your SSN only when required, and if any organization, company or medical provider attempts to use your SSN as an identifier, ask them not to. (Many laws prevent this, in fact.)

Additional Fraud Prevention and Reporting Resources

Visit the following websites for step-by-step instructions designed to document and hinder previous, current or future fraudulent activity. They have great resources on how to prevent specific types of fraud, including mail, credit card, email phishing scams and more: